The AOC’s of student loan debt https://www.dailyfreeman.com/2021/12/21/tom-purcell-the-aocs-of-student-loan-debt/ Tis the season for giving — or, for some legislators, a good time to demand that the government force taxpayers to give others a large gift. A few weeks ago, Rep. Alexandria Ocasio-Cortez took to the house floor to issue another plea for the federal government to cancel nearly $1.7 trillion in student-loan debt. That is, she is demanding that taxpayers who didn’t go to college, or who didn’t take on large loans to go to college, pay off the often massive loans of those who did. AOC argues that the student-loan system is ridiculous because at age 32 she still owes $17,000. But then she unwittingly puts her finger on the crux of the student-debt problem: “It’s teenagers signing up for what is often hundreds of thousands of dollars of debt…” she says. “We give 17-year-olds the ability to sign on and sign up for $100,000 worth of debt and we think that’s responsible policy.” Of course it’s not responsible policy. Of course borrowing 100,000 smackers before you’re even old enough to vote is not sound decision-making. Of course it is a problem created and long enabled by lax federal student-borrowing policies. A 2015 study by the National Bureau of Economic Research found the increase in student loan availability correlates to nearly all of the increases in college tuition since 1987. It’s not complicated: The more you allow young people to borrow, the more colleges jack up their costs — because colleges have known the borrowers will borrow more. To compete for students — and to “justify” their ever-climbing tuitions — colleges have been on massive spending sprees the last 20 years, borrowing billions to build five-star dorm rooms and other lavish amenities. A massive increase in non-academic administrators — people who do not teach or conduct research, but who earn fat salaries nonetheless — also has exploded the cost of running a college, according to the Huffington Post. How to fund all these spiking costs? Raise tuitions. A report by myelearningworld.com finds that in the last 50 years college tuition costs have risen five times the inflation rate. If tuitions had kept pace with inflation, today’s students at private and public universities would be paying $10,000 or $20,000 a year – HALF of what they are today. The entire tuition-funding scheme has been a sweet racket for the higher-education industrial complex for a long time. But more and more young people (and their parents) are seeing through it. Instead of borrowing tens of thousands of dollars to get a college degree, more high school grads are choosing good-paying, no-debt opportunities in the trades. And with a record number of open jobs and a dearth of willing job candidates, more companies are hiring young people without college degrees. This decreasing demand has forced colleges to suddenly begin cutting their “sticker prices,” according to Forbes. So if more young people are becoming more sensible about taking on massive debt, would it be too much to ask our lawmakers to come to their senses, too? Their well-meaning but wrong-headed student-lending policies have helped to create a massive $1.7 trillion debt bubble. Demanding that the rest of us pay off the college debts that millions of others so willingly took on is not just ridiculous, it’s patently unfair. Case in point: Alexandria Ocasio-Cortez makes $174,000 a year. Rather than force taxpayers to pay off her $17,000 college loan, maybe she should trade in her Tesla for a used Hyundai.
The whole scenario is snaky. The dems are beginning to promote this student loan thing as an attempt to clean up or salvage pieces of the Build More Bullshiite bill. Except student loan forgiveness was not in that bill. It looks like Biden was keeping it in his back pocket and waiting to get Manchin's vote on BBB first, rather than watching his head explode by piling that up on top of the heap while BBB was teetering. Snaky.
There is a simple solution for the "student loan crisis". Thanks to lobbyists -- Student loans are the only type of loans which cannot be discharged via bankruptcy. Congress should change this rule to allow student loans to be discharged via bankruptcy. After this change we will see banks (and the government) tighten their lending standards for student loans to appropriately reflect their risk and the probable ability of a student to pay back the loans in the future based on their projected earning in their targeted career.
That's part of the picture and remedy. Although allowing discharge in bankruptcy is not enough if the feds are still guaranteeing the loan. That is what led to the similar fiasco in the housing crisis. The banks and mortgage lenders just kept pumping away and could care less with the borrower ever paid a dime. They still got paid and the government guaranteed the loan at least off in the world of freddie, fannie, sallie, etc. The other piece is that every instutution should have to have a rating from some kind independent non-corrupt agency showing the degree program and the instutution and what the average income is for their graduates two, five, and ten years out where available. If the capacity to repay is not apparent in the numbers from that program, then there should be a formula either denying or limiting the amount that can be borrowed. Doesn't mean that you can't major in TransSpecies Relationship Studies. It just means that you have to get your money somewhere else. Also, it should be worked the other way too, to reward students going into needed fields where they are likely to benefit both themselves and meet societal needs, by giving them a better rate or terms.
It has been a nice gravy train for the colleges. Most of those clowns would be out of business if you disallowed loans to any programs where graduates -on average- have the ability to pay, they would be out of business bigtime.
So if I buy a house or a car I can just stop paying the debt because the seller should bear the risk... it is their product right? Methinks you skipped "collage"
AOC is so dumb. How dumb is she? So dumb that she does not understand that a Senator represents more people than she does. Fact check: Does AOC represent more people than Joe Manchin? https://www.wral.com/fact-check-does-aoc-represent-more-people-than-joe-manchin/20051925/ After Sen. Joe Manchin, D-W.Va., said he could not support President Joe Biden’s safety net bill, the Build Back Better Act, a leading House progressive, Rep. Alexandria Ocasio-Cortez, appeared on MSNBC’s "Morning Joe" and took aim at the senator. "The idea that Joe Manchin says that he can’t explain this back home to his people is a farce," Ocasio-Cortez said on Dec. 20. "I mean, it’s a farce in terms of plain democracy, because I represent more or just as many or more people than Joe Manchin does — perhaps more," she said. On the numerical comparison, Ocasio-Cortez is wrong. (Her office did not respond to an inquiry for this article.) Ocasio-Cortez represents the 14th congressional district of New York, which includes parts of two boroughs in New York City. The district’s population was 696,664 in the most recent Census estimate available, from 2019. By contrast, Manchin, who as a senator represents the whole state of West Virginia, has 1,793,716 constituents, according to the 2020 Census. That means that Manchin represents roughly 2.6 times as many people as Ocasio-Cortez does. Senators run in statewide elections and count the entire state’s population as their constituency. But for those who would argue that each of a state’s two senators should count for only half the population, Ocasio-Cortez’ statement still falls short. Half of West Virginia’s population is close to 900,000, which is nearly 30% more than Ocasio-Cortez’s district has. We rate the statement False.